Year End Tips: Six Ways to Protect Your Assets Right Now

As we at the Sovereign Society have been telling folks for over ten years now, if you have wealth, you need wealth protection.

And procrastination can steal more than your time - it can destroy your wealth. So act today. Just a few simple steps - plus some offshore advantages - can ensure that your hard-earned assets remain yours and can be passed on to your family and loved ones.

And, for Americans, these steps are especially important to consider now, with the likelihood of drastic tax and law changes coming under an Obama government.

1) Keep a low profile. Owning assets in your own name too often is like throwing chum in the water for the circling schools of sharks -- lawsuit-happy lawyers and litigants. If people think you're rich, your chance of being sued skyrockets.

One way to lower your profile is not to title your assets directly in your own name. Instead, use a privacy-protected offshore corporation, family foundation or an asset protection trust (APT) to hold title. In many places such ownership is not a matter of public record.

2) Shrink the target. Let's say you own a number of rental properties. A tenant slips and falls at one of these places and decides to sue you. Unless you take precautions, total damages could amount to the value of all your rental properties. Whether it's a rental property, a restaurant, or something else, segregate risks - consider creating a separate corporate entity for each liability generating asset. Especially, never mix large liability-generating assets. For example, an apartment house should not be owned by the same company that owns a trucking company.

3) Going offshore adds a strong layer of protection. Whether it's in a Swiss or Liechtenstein life insurance wrapper, retirement annuity or an Isle of Man or Panama asset protection trust, placing your assets offshore puts them out of reach of most frivolous lawsuits. Even litigants with an ax to grind usually are ready to settle for pennies on the dollar when they find out how difficult it is to locate and collect your money offshore.

For example, if you place your 401k or other retirement plan in a suitable jurisdiction - Panama or Switzerland, for instance - it can be configured to be essentially claim and judgment proof, plus it is covered by strict financial privacy laws that are non-existent in the United States.

4) Get Good Advice. Avoid pushy domestic and offshore hucksters - the ones claiming falsely that you can lower your tax bill to zero if you just put all your money in their "pure trust," a "constitutional trust" or a "corporation sole." Well, you might not pay any taxes, but only because these hood winkers will take all your money and run with it. And you could go to jail.

And avoid those Bernie Madoff types who promise you the moon on investment returns. The rule is - if it sounds too good to be true, then it is too good to be true.

Always work with carefully vetted bankers, investment advisors, financial experts, and legal professionals from select tax and asset haven jurisdictions. Always check references and do your due diligence homework on a service provider before sending them a single penny. Asks us if you want recommendations for good, solid contacts.

5) Pass on your legacy with an offshore trust. In most cases, while an offshore trust will protect your assets, it won't reduce your U.S. tax bill. However, an offshore trust can incorporate provisions that can reduce future estate tax liability. It can protect your wealth, notwithstanding efforts by the U.S. or other governments, to discourage legal offshore financial transactions and investments.

Frivolous litigation, expensive legal defense costs, outrageous jury awards, and government privacy invasions and asset forfeiture all create an urgent need to protect your family and business wealth. An APT can do all that and more.

6) File all returns and reports. certain path to asset loss is ignoring U.S. tax filing and reporting requirements or giving inaccurate or partial information. Get a good CPA who knows the reporting and other rules.

Almost every nation now has "know your customer" laws that require bank account applicants to prove their identity, the source of their funds and their life story. Cash transfers of US$10,000 or more are reported electronically to the U.S. government. U.S. persons, on their IRS Form 1040, must say if they have an offshore account, and if activity therein exceeds US$10,000 an annual U.S. Treasury Form TD F 90-22.1 must be filed. Lying or failure to file these reports are separate felonies.

We at the Sovereign Society can and will help you with all of the above (and more) asset protection devices. Our executive director, Erika Nolan, myself and our Sovereign Society editors often have visited many tax and asset protection havens. We've made strong banking, legal, trust and other professional contacts that are useful to our members with offshore business and financial interests.

That’s another good reason why you should protect yourself and your wealth by joining this unique organization that, for more than a decade, has shown the way for sound offshore banking, prudent investing and real financial peace of mind -- the Sovereign Society.